Workers’ compensation insurance is a no-fault insurance system. Workers’ compensation exchanges your limited, absolute liability for work-related injuries and illnesses for your employees’ common-law right to sue you for damages. Essentially, you are liable for work-related injuries and illnesses, but your employees usually cannot sue for additional damages.
If there is any doubt that workers’ compensation is applicable to a particular situation, the Division of Workers’ Compensation (DWC) generally rules in favor of coverage. Workers’ compensation coverage benefits employers by making workers’ compensation the “exclusive remedy” for workplace injuries or illnesses. However, there are exceptions to workers’ compensation exclusivity, either created by statute or court decision.